The state of Montana’s costly experience with the Pegasus Gold Corp. resulted in a substantial change in the way mine reclamation bonds are reviewed and issued. In 1998, Pegasus, which operated a number of mines in Montana, went bankrupt, leaving behind an inadequate reclamation bond. Montana taxpayers will pick up the estimated $10 million bill for water treatment at Pegasus mine sites across the state.
Not wanting to get burned twice, the state Department of Environmental Quality (DEQ) has changed its procedure for issuing reclamation bonds to more accurately reflect the real costs of clean-up, water treatment and land reclamation.
For at least one Montana mining company the new procedure has meant a substantial increase in the cost of its bond.
Last week, the DEQ announced that Stansbury Holdings Corporation, which owns a vermiculite mine east of Hamilton, must pay a $110,639 reclamation bond, an increase of more than $81,000.
Patrick Plantenberg, a DEQ section chief, says the state’s Metal Mine Reclamation Act requires regular reviews of reclamation bonds. When the state was forced to reclaim the Pegasus mines DEQ officials found out how much it really costs to clean up old or abandoned mines, hence the upgrades in bonding procedures. “DEQ has to assume the company leaves in the middle of the night and [the mine is] ours,” he says.
The company has never mined the area, and the Forest Service would like the company to either mine its claims or reclaim the site. “The agencies, the state and the Forest Service, are getting tired of being put on hold when it comes to reclamation of the site,” says Forest Service geologist Lynne Dickman.
If Stansbury does mine, the site will not have to be reclaimed, she says. If not, the company should clean up the mess it inherited when it bought the claims. And the mess isn’t too extensive—no toxic leaching or anything of that sort—but the area is littered with abandoned pipes and other equipment, and it is weed-choked.
“I’ve been wanting to clean it up for years, but the state says we can’t because they’ve paid their corporation fees.”
The company should reclaim the mine site, she says, because company spokesmen have said publicly that Stansbury has no plans to mine for at least 25 years.
Stansbury Holdings, an investor-owned corporation headquartered in Denver, has 30 days to comment on the increase in its reclamation bond.